Blockchain: Diamond Industry’s New Hope

“Diamonds have an image of purity and light. They are given as a pledge of love and worn as a symbol of commitment. But are they really?”– Peter Singer, Australian moral Philosopher

Blood Diamonds

‘A Diamond is Forever’ is probably the most successful advertising campaign of the century! De Beers, the leading Diamond jeweler in the world, achieved a coup in the jewelry business. They have managed to condition an entire generation into believing that, there can’t be a marriage ceremony if a diamond ring worth 2 month’s salary is not procured by the fiancé. In reality, Diamonds are neither rare nor as valuable. In 1870 huge diamond mines were discovered in Africa. To prevent the potential saturation in the Diamond market, De Beers managed to achieve control on the amount of diamonds being exported from Africa. N.W. Ayer agency was hired by them to market Diamonds as a rare and precious gem stone. They sold it as an emotional symbol of trust and commitment. Despite the economic slump, Americans lapped up the idea of a matrimonial symbol, THE Diamond Ring.

The Diamond movement received a boost when Marilyn Monroe starred in the movie. ‘Gentlemen prefer Blondes’. Madonna even sang a track, “Diamonds are a girl’s best friend”. This furthered the campaign in American Media.

What the Americans did not know, was the inhumane conditions faced by the miners. The sudden surge in its demand continues to this day. It has inversely increased violence, torture and poverty culminating in a civil war. Rebels loot and terrorize villages for diamonds, which they sell and fund their insurgency.

Unfortunately, even governments are responsible for similar abuse as they are solely focused in generating undisclosed income and profits. Diamonds that are mined in such adverse conditions are known as Blood or Conflict Diamonds.

A Time for Change:

Technology has always been the answer. It does not matter what the question is. Blockchain Technology is the new kid on the block. It has surpassed expectations in the field of Media, Education and in creating a Digital Identity for people. In preventing near genocide in the name of mining of Diamonds, Blockchain tech is holding accountable all the overseers. Blockchain provides a detailed description regarding same. Individual nodes or blocks register the date, people and processes that are involved from Mine to Store. I.e. From the time, a gem is excavated from the soil, till the time it is worn as part of a jewelry, each and every aspect is now being registered on the virtual ledger that is Blockchain. Any inconsistency in the entire process shall reflect on the detailed, digital history of the stone lowering its value in the market.

People now want to purchase Diamonds from ethical sources. Suppliers who provide an environmental standard of living to its miners and follow all the labor laws.

More and more people are now aware of the insufferable conditions involved and are hence looking for conflict free diamonds that not only reflect their financial status but can also echo their values. Below mentioned are some examples of Blockchain implementation in Diamond Mining Industry.

EVERLEDGER:

A revolutionary platform that logs and stores details for each and every stone mined, on to Blockchain. Using machine vision, they record 40 metadata points to create a unique thumbprint of each stone. They have 1.6 million diamonds whose data in on the blockchain. This helps in establishing authenticity, provenance, and custody of diamonds while using a single source across the entire supply chain. In the future, people can know the diamonds origins, every owner of a diamond, apart from the 4Cs (Cut, Color, Clarity, and Carat-weight) The blockchain aims to be absolute, fast and scalable. It brings trust and transparency to diamond trading which is long overdue.

Singapore Diamond Investment Exchange:

Working in tangent with Everledger, SDIX aims to build total trust in physical commodities like Diamonds and other gemstones. They have completed the first part of a ‘Proof-Of-Concept’ in a blockchain-based authentication and secure record-keeping process. This helps trading diamonds on a global commodity exchange level. Any diamond purchased through SDIX automatically gets updated on Everledger and holds the untampered data of the stone in question.

A New Hope:

While technology is trying its best in creating a detailed record of all the stones that they come across. There still remain instances of fraud and ‘lost or stolen’ jewelry. This aspect of human greed unsettles the entire structure of transparency. With individuals not declaring the number of diamonds that they possess in order to avoid taxes or prevent theft, a large percent of stones do not carry the basic Gemological Institute of America (GIA) certification of authenticity.

This technology has the potential to be used in securing data of Fine Arts and other luxury items. While the complete end of labor violations may not reside solely on Blockchain, it still promises to start the change.

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